Question

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3. Clark Company makes and sells artistic frames for pictures of weddings, graduations, and other special events. Ron Jangles, the controller, is responsible for preparing Clark's master budget and has accumulated the following information for 2018 (Click the icon to view some of the financial information.) Click the icon to view additional information) Read the requirements Click the icon to see the Worked Solution. Requirement 1. Prepare a production budget and a direct manufacturing labor cost budget for Clark Company by month and for the first quarter of 2018. You may combine both budgets in one schedule. The direct manufacturing labor cost budget should include labor hours and show the details for each labor cost category. Start the schedule by preparing the production budget and calculating the total hours of direct manufacturing labor time needed for the three months in the quarter, then calculate the values for the quarter. Finish by preparing the bottom portion of the schedule for the direct manufacturing labor by month, then quarter. (Enter the direct manufacturing labor-hours per unit to one decimal place, X.X. Do not round interim calculations, and then enter all amounts in the budget (other than the direct manufacturing labor-hours per unit to the nearest whole number.) March Quarter Clark Company Budget for Production and Direct Manufacturing Labor For the Quarter Ended March 31, 2018 January February Budgeted sales (units) Add target ending finished goods inventory (units) Total requirements (units) Deduct beginning finished goods inventory (units) Units to be produced Direct manufacturing labor-hours per unit Total hours of direct manufacturing labor time needed

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Answer 1

1) reduce the manufacturing labour hours needed to produce each units

2) decrease labour productivity

Production Budget Tort (Scoo 5000 10,000 God boles Al-Target M1500 12000 Ooo 20500 ending Fact) 17000 4500 total Requirement 30500 27000 9000 Soooo 20500 den - Beginning 20500 Went to be produced 10,000 6500 3000 24500. Direct manufacturing 205 205 105 Labour Hros por unit Total Hours ( Needed) 25000 16250 12000 53250 Direct Manufacturing Labour cost Quarte Jan Feb - 250000 12 16isor 12 300000 195000 Pansion Contabution 15000 9750 Lors for bevallon 2900 1603 Employee medical insuone 12500 8125 Soual becurity tay 49500 32175 total (379500 246675 March (rocox12 144000 7200 1100 6000 28560 639000 31950 525 26625 - 105435 182160 808335.